Jim Chisholm is senior strategy advisor to the World Association of Newspapers, director of its Shaping the Future of the Newspaper project and the former managing director of a Scottish national newspaper.

He is a frequent speaker at newspaper conferences on every continent save Antarctica, and there is perhaps no one in the world who has a more global perspective about the challenges facing online and newsprint editions.

Chisholm thinks that newspapers are facing major problems but can survive -- provided that they are realistic about what must be done to solve those problems.

"The sad fact," he said, "is that the major issue is the declining interest in news generally, in both volume and intensity."

But that isn't a problem solely confined to newspapers, he said. "Look at TV news. Despite the explosion in the number of news channels, and volume of output -- a 25-fold increase in the last 20 years -- time spent watching news on TV has declined at twice the rate of newspaper circulations, at least here in Europe.

"The fact is we compete with people's lifestyles -- the golf course, the restaurant, shopping," Chisholm said. "Just as successful newspapers respond to readers lifestyles and material demands, so their online services must do the same.

"Yes, Internet usage levels have more or less reached saturation, but the conversion of that coverage into intensity of news consumption remains very low. Online news publishers must learn more about satisfying consumers' needs rather than translating their print services into online."

"Newspapers are a lifestyle tool, a package of services. And, as more and more publishers are tuning their services, we are seeing newspapers stabilizing."

So what will happen?

"With hindsight, we realize that the PC Internet was never going to be a substitute for newspapers, because it is largely deskbound," Chisholm said. "But mobile will have a dramatic effect on information consumption, and we are already seeing an explosion in this area, driven by simplistic PPV (pay per view) models.

"But people are not rushing out to pay for news headlines. They want key facts and fun things."

Chisholm noted that two other factors will drive the difference in media usage between the deskbound PCs and mobile devices.

"The first is the issue of payment method," he said. "Obtaining stuff on the mobile phone is almost subliminal. Last week, my 11 year old downloaded $30 of ring tones to his phone without realizing. Who actually knows the cost of a text message or downloading a headline? We just do it.

"The second factor is context. We can download what we want, when we want, where we want. On a platform, download a timetable. In a shopping mall, find the best price. In the pub with your mates, find out a football score. Context drives content, drives consumption," said Chisholm.

He said consumption of news and other services online will continue to grow and that publishers shouldn't worry that levels of media consumption will decline.

"The issue is what they are consuming. It is not necessarily in the form that we think of as content. We need to think a lot harder about what constitutes news. News needs to more tuned to my personal priorities and this means journalists moving from wide audience, low relevance stories (i.e., small earthquake reported in Peru) to low audience, high relevance stories," Chisholm said.

"What would be regarded as trivia by most journalists may be life changing for 10 people. We must learn to serve the groups of ten, or even media markets of one."

Chisholm said this has three levels of implications for commercial models. "The first is determining the media consumers' needs and interests. It is only through knowledge-based customer relationships that we can hope to be the primary source of content satisfaction.

"The second lies in determining the level of pricing and the method of payment, and this is ultimately determined by how valuable the information is to that individual media consumer.

"The third factor relates to how we avoid being disintermediated by the advertisers. And this all comes down to our ability to deliver them relevance as well. ... " he said.

Chisholm thinks two things are holding back the newspaper industry.

"The first is developing a true understanding of our customers' news and information needs, across media platforms. These are not what we currently offer. The second is changing our mindset about we deliver what they want," he said.

"I am very optimistic that if we can address these two issues, the news media will have a very healthy, profitable future, but we must overcome some pretty significant mindsets along the way."